The craft beer market and craft beer raw material supply sector continue to evolve.

Although total beer sales by volume is slowly declining in the U.S., as a result of increased competition with spirits and wine, and a decline in overall alcoholic beverage consumption, volume of craft beer sales increased in 2017.

In terms of sales volume, craft beer represents 12.7% of total U.S. beer sales, but over 23% of sales dollars.

Overall U.S. beer sales by volume, craft, import and export craft categories (Source for charts: Brewers Association)

Despite continued growth, the craft market has matured in recent years. While market growth has slowed, the Brewers Association contends there will likely be over 7,000 U.S. breweries in operation by the end of 2018.

Michigan ranks fourth in the U.S. in the number of craft breweries behind California, Washington and Colorado. Although overall gallons of beer sold in Michigan has consistently declined over the last 30 years, sales of Michigan-made beer have increased. In 2007, Michigan-made beer represented only 2% of beer sold in Michigan. Ten years later it has increased to 10%.

Craft beer as a % of overall sales volume and sales dollars

In 2017, of the 187 million gallons of beer sold in the state, Michigan brewers sold 18.7 million gallons in Michigan, with Bells at 5.9 million gallons, Founders at 3.2 million and Shorts at 1.1 million. These figures do not include beer sold outside of Michigan.

The craft beer sector has influenced agricultural raw materials used in beer. The hop market has changed dramatically over the last 10 years. Although craft beer only accounts for 2.5% of total beer volume worldwide, it uses 20% to 25% of the total global hop crop.

U.S. acreage is up nearly 80% from 2007, with increases each year since 2011. From 2017 to 2018, overall acreage increased nearly 4%. While there were modest increases in Washington and Oregon, production in Idaho increased nearly 18% (from 6,993 to 8,217 acres). Production outside of the three major growing regions decreased slightly.

Number of Michigan craft breweries and associated economic impact

Save the date
Traverse City will host the 2019 Great Lakes Hop and Barley Conference on March 1-2 at the Park Place Hotel. The event will focus on nutrient and water management, weed control, and pruning and training in hops.

If interested in sponsorship or vendor opportunities, contact Betsy Braid at [email protected]. 

Visit Michigan State University Extension’s hop webpage or the MSU Hops News on Facebook for up-to-date information.

Source: MSUE